City sues team for $170,000

The city of San Diego has filed a breach-of-contract suit against the Chargers, claiming the team owes the city more than $170,000 for use of Qualcomm Stadium in 2004, including more than $44,000 in accrued interest.

The suit came as a surprise to the Chargers, who noted that the team's lease with the city calls for any controversy between the two parties to be decided in arbitration – and not in a lawsuit.

“The contract is clear,” said Mark Fabiani, the Chargers' special counsel. “We're not allowed to go to court against the city, and we don't believe the city is allowed to go to court against us.”

The idea behind mandatory arbitration was to save legal expenses and time. Fabiani said he expected the suit to be dismissed because of this lease stipulation.

The city's suit says the Chargers were obligated to pay $250,000 per game in rent for the city-owned stadium, subject to certain rent credits allowed by the city in the lease. In 2005, the city audited payments by the team for 2004 and found the team underpaid the city by $125,795 as a result of the Chargers claiming skybox rent credits that were previously disallowed by the city for the 1996 through 2000 seasons.

City Attorney Jan Goldsmith said the suit was filed at the direction of the city treasurer's office, which oversees collections. He said the four-year statute of limitations on the case was about to expire, making a suit necessary to preserve the city's right to make a claim.

“I'm confident we can work this through quickly without litigation,” Goldsmith said. “We just had to preserve the right. We're talking to them, and it's going to be resolved.”

Despite this skirmish, relations between the Chargers and the city attorney have warmed considerably since Goldsmith took office after beating incumbent Mike Aguirre in last year's election. Fabiani and Aguirre were not on speaking terms. At one point, Fabiani had said, “If the Chargers are eventually forced to leave San Diego, there can now be no doubt that Mike Aguirre will be to blame.”

Fabiani said the team soon plans to talk to Goldsmith and other new city officials about the status of the Chargers' search for a new stadium.